Salaries in the UAE Meeting the Mark?
September is usually a busy month for recruiters anyways and the heightened temperature of the job market this fall in countries like UAE, Kuwait and Qatar has made the demand for fast, easy and cost-effective recruitment hotter than usual. A recent salary survey indicates that salaries in the Gulf have risen by 7.9% over the last 12 months with Qatar and the UAE leading the regional trend with pay hikes of 11.1% and 10.3% respectively.
A new Hay report on pay brackets in the UAE job market has the average increase in guaranteed cash levels at 5.3% for the year ended April 2006, ahead of the UAE’s official inflation rate of 4-6% but lagging behind the 8% inflation figure the IMF released for the UAE earlier this year. A report in the Gulf News titled ‘UAE Salaries Still Inadequate’ (29 September 2006) quotes the chief of the UAE mission at the IMF describing the trend as “one of the major challenges facing the UAE economy”. The pay hikes according to the article have apparently impacted senior executives more favorably as their packages rose by 8-11% compared to 4% for middle income earners.
A Mercer Human Resource Consulting study earlier this year showed Dubai to be the most expensive city in the Arab world and the 25th most expensive globally. Dubai jumped nearly 50 places from last year. Rising costs according to the study have threatened to dent the competitiveness of Dubai, a regional trading hub with a rapidly growing population comprised mostly of expatriates.
In a poll conducted by bayt.com earlier this year, 54% of respondents said their pay has not risen for the financial year ended April while 24% said they had been given a raise but it was not what they had been looking for.
So how do the UAE’s employed cope with the inflationary pressures and salaries which are not consistently rising to meet the mark? The answer is that while some expatriates are beginning to think seriously about returning to their countries, there is no shortage of skilled professionals from overseas longing to return to the region in their place. Leading recruitment companies have already seen reverse migration as workers unable to find salaries that make their stay in Dubai attractive and viable, are returning to their countries or considering other countries in the GCC where the living costs are lower. At the same time, with the global lure of Dubai and its promise of a new “Arab renaissance” as a senior Government official was quoted as describing recently, Dubai will continue to attract top talent, especially from the pool of Arab professionals overseas who have gained valuable experience abroad and long to return to the region with their families.
An article in the Gulf News on 23 August titled “Top Arab executives being wooed back to Middle East” asserts that, according to executive search firms, the thriving Gulf economy is now more developed than when many bosses from the region left for the West and flourishing economies make the Gulf region a fertile ground to woo back top Arab executives working in the West. Certainly, according to bayt.com, the Middle East’s #1 job site, there is no shortage of exceptionally qualified Arabs and non-Arabs from overseas who are willing and eager to migrate to the region and many will even consider a pay cut in nominal terms in a place like Dubai in order to enjoy other intangible benefits related to lifestyle, culture, climate and proximity to their families.
